Citibank: Launching Credit Card in Asia Pacific

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Citibank: Launching the Credit Card in Asia Pacific

1.0 Launching the Credit Card in Asia Pacific Region Citibank should launch the card product in Asia for several reasons. Firstly, Citibank can ride on the rapid economic development in the region via credit card products. Secondly, it is also an excellent way to overcome distribution limitations imposed on foreign banks in the region. Thirdly, it allows Citibank to expand its customer base from the upper income segment to include the rapidly growing middle-income households, which is consistent with its global growth strategy and mission in Asia Pacific. Fourthly, by introducing credit cards, Citibank will be able to cross-sell other product lines such as Auto Loans and Ready Credit to
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Appendix:
Exhibit 1: Customer Acquisition Cost Channel | Unit Cost($) | Prospects Reached | Response Rate | Qualification rate | Conversion Rate | Customers | Cost/Customer | Direct Mail | 1.5 | 300000 | 2% | 2/3 | 80% | 3200 | 140.625 | Take-Ones | 0.25 | 2000000 | 1.50% | 1/3 | 80% | 8000 | 62.5 | Direct Sales | 18,000/Sales | 30000 | 50% | 2/3 | 80% | 8000 | 2.25 | Bind-ins | 0.15 | 3000000 | 1% | 1/3 | 80% | 8000 | 56.25 |

Exhibit 2 Comparison of Countries in Asia Pacific Region | AUS | IND | INA | MAL | Income per capita | 11,929 | 279 | 338 | 2018 | Political risk | A | C | C | B | Saving rate | 6.7% | 19.6% | 27.9% | 23.8% | Avg. annual customer | 60,000 | 10,000 | 24,000 | 14,000 | income | | | | | Avg. customer bank | 24,000 | 3,500 | 9,000 | 23,000 | balance | | | | | Potential credit card | Above 25k | Above 12k | Above 25k | Above 12k | customer income * | | | | | % Population** | 12.50% | 3% | 3% | 15% | % Credit card market** | 30% | 20% | 40% | 55% | Credit card market | Saturated | Low penetration | Few can qualify | Competitive | CC popularity | Commonplace | Upper middle

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